Staff working papers provide a forum for staff to publish work-in-progress research intended for journal publication.
1320
result(s)
Adopting Price-Level Targeting under Imperfect Credibility: An Update
Staff Working Paper 2008-37
Oleksiy Kryvtsov,
Malik Shukayev,
Alexander Ueberfeldt
This paper measures the welfare gains of switching from inflation-targeting to price-level targeting under imperfect credibility. Vestin (2006) shows that when the monetary authority cannot commit to future policy, price-level targeting yields higher welfare than inflation targeting.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Credibility,
Monetary policy framework
JEL Code(s):
E,
E3,
E31,
E5,
E52
The Role of Bank Capital in the Propagation of Shocks
Staff Working Paper 2008-36
Césaire Meh,
Kevin Moran
Recent events in financial markets have underlined the importance of analyzing the link between the financial health of banks and real economic activity. This paper contributes to this analysis by constructing a dynamic general equilibrium model in which the balance sheet of banks affects the propagation of shocks.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Economic models,
Financial institutions,
Financial system regulation and policies,
Monetary policy transmission
JEL Code(s):
E,
E4,
E44,
E5,
E52,
G,
G2,
G21
Globalization and Inflation: The Role of China
Staff Working Paper 2008-35
Denise Côté,
Carlos De Resende
In this paper, we develop a theoretical model which identifies four channels–import prices, competition with domestic suppliers and workers, and commodity prices–through which price- and wage-setting conditions in country j may affect inflation in country i.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
International topics
JEL Code(s):
E,
E2,
E22,
E3,
E32,
E4,
E44
Combining Canadian Interest-Rate Forecasts
Staff Working Paper 2008-34
David Bolder,
Yuliya Romanyuk
Model risk is a constant danger for financial economists using interest-rate forecasts for the purposes of monetary policy analysis, portfolio allocations, or risk-management decisions. Use of multiple models does not necessarily solve the problem as it greatly increases the work required and still leaves the question "which model forecast should one use?"
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Econometric and statistical methods,
Interest rates
JEL Code(s):
C,
C1,
C11,
E,
E4,
E43,
E47
Human Capital Risk and the Firmsize Wage Premium
Staff Working Paper 2008-33
Danny Leung,
Alexander Ueberfeldt
Why do employed persons in large firms earn more than employed persons in small firms, even after controlling for observable characteristics? Complementary to previous results, this paper proposes a mechanism that gives an answer to this question.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Economic models,
Labour markets,
Productivity
JEL Code(s):
J,
J2,
J24,
J3,
J31
Market Structure and the Diffusion of E-Commerce: Evidence from the Retail Banking Industry
Staff Working Paper 2008-32
Jason Allen,
Robert Clark,
Jean-François Houde
This paper studies the role that market structure plays in affecting the diffusion of electronic banking. Electronic banking (and electronic commerce more generally) reduces the cost of performing many types of transactions for firms.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial institutions,
Market structure and pricing
JEL Code(s):
D,
D1,
D14,
D4,
G,
G2,
G21,
L,
L1
Aggregate and Welfare Effects of Redistribution of Wealth Under Inflation and Price-Level Targeting
Staff Working Paper 2008-31
Césaire Meh,
José-Víctor Ríos-Rull,
Yaz Terajima
Since the work of Doepke and Schneider (2006a) and Meh and Terajima (2008), we know that inflation causes major redistribution of wealth – between households and the government, between nationals and foreigners, and between households within the same country.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Economic models,
Inflation and prices,
Inflation targets,
Inflation: costs and benefits,
Monetary policy framework,
Sectoral balance sheet
JEL Code(s):
D,
D3,
D31,
E,
E2,
E21,
E3,
E31,
E4,
E44,
E5,
E52,
E6,
E63
Non-Linearities, Model Uncertainty, and Macro Stress Testing
Staff Working Paper 2008-30
Miroslav Misina,
David Tessier
A distinguishing feature of macro stress testing exercises is the use of macroeconomic models in scenario design and implementation. It is widely agreed that scenarios should be based on "rare but plausible" events that have either resulted in vulnerabilities in the past or could do so in the future.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Financial stability
JEL Code(s):
C,
C1,
C15,
G,
G2,
G21,
G3,
G33
Macroeconomic Determinants of the Term Structure of Corporate Spreads
Staff Working Paper 2008-29
Jun Yang
We investigate the macroeconomic determinants of corporate spreads using a no-arbitrage technique. Structural shocks are identified by a New-Keynesian model. Treasury bonds are priced in an affine model with time-varying risk premia.
Content Type(s):
Staff research,
Staff working papers
Topic(s):
Debt management,
Financial markets,
Interest rates
JEL Code(s):
E,
E4,
E43,
E44,
G,
G1,
G12